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Understanding Early-Stage Valuation and Fundraising Sizing
If you want to score the largest possible early-stage valuation, what should your startup focus on? New data makes it clear that the seed and Series A markets are hardly equal when it comes to what venture capitalists are willing to pay for one category of startup over another.
Don’t worry, the answer here is not just “build an AI startup,” even if that does appear to be pretty solid advice for avoiding a down round.
The Stratification of Early-Stage Valuations and Fundraising Sizing
Data shared by Carta when we interviewed the company’s CEO on the Equity podcast earlier this week provides a simple and clear stratification of early-stage valuations and fundraising sizing. Let’s start with seed data:
Seed Stage Data
The chart provided by Carta shows that the median seed-stage valuation in the US, across all sectors, is $11 million. However, this varies greatly by sector. For example, seed-stage startups in the biotech, healthcare, and medical sectors have a median valuation of $18 million, while consumer startups have a median valuation of $9 million.
Series A Data
The median Series A valuation for startups across all sectors is $29 million. Similar to seed-stage valuations, there is a great deal of variation across sectors. Series A biotech, healthcare, and medical startups have a median valuation of $42 million, while consumer startups have a median valuation of $23 million.
Conclusion
When it comes to early-stage valuations and fundraising sizing, it’s important to understand the market realities of your particular sector. By knowing the typical valuations at each stage of fundraising, you can better strategize your fundraising and position yourself for greater success.
FAQ
What is the median seed-stage valuation in the US?
The median seed-stage valuation in the US, across all sectors, is $11 million.
What sectors have the highest median seed-stage valuations?
Medtech, biotech, and healthcare startups have a median seed-stage valuation of $18 million.
What is the median Series A valuation for startups?
The median Series A valuation for startups across all sectors is $29 million.
What sectors have the highest median Series A valuations?
Biotech, healthcare, and medical startups have a median Series A valuation of $42 million.
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